"We have fewer customers, but more of the right customers." These are the quotable words of the President and CEO of an online grocery service that inspires consumer laud to an award-winning degree.

I recently spoke with Lisa Kent of Netgrocer.com (now known as Nexpansion, but more on that in Part 2 of this article) to learn what makes the company unique in their industry and how focusing in on the "right" customers has been the key.

Right from the start of our conversation, it was obvious that Lisa gives priority to customer email over just about anyone (including reporters). That company-wide honoring of customer feedback shows in the sites' functionality, and in the company's product selection and active feedback channels. That Netgrocer.com has earned the highest percentage of positive feedback from Planetfeedback's users (they won the 2000 "Consumer Voice" award) makes Lisa particularly proud.

Customer As Active Participant
The customer who can be inspired to interact with Netgrocer.com about products to carry and how the online grocer can improve the online shopping process is the "right" customer.

Most of Netgrocer.com shoppers are women, and Lisa knows that that fact is one of the big reasons the company gets so much proactive feedback. And, the folks at Netgrocer.com really do use what they learn through their participatory customer base to expand product line offerings and fine-tune customer experience.

In fact, during my interview with Lisa, my childhood fondness for Coffee Crisp candy bars emerged and I bemoaned how hard they were to find now. She took note and is in the process of exploring the possibility of carrying those Canadian favorites through Netgrocer.com. Lisa has a nose for figuring out which specialty products, especially those with emotional attachment possibilities, may draw customers to Netgrocer.com for the first time.

Once a customer becomes a regular, it would be pretty hard to tear them away. A few of the reasons why Netgrocer.com "regulars" are so loyal:

• They have always had a live voice 800# for customer service.
• 100% satisfaction is guaranteed throughout the experience (web site shopping to shipping/delivery and the occasional return).
• They respond to every customer comment promptly (within 24 hours in most cases).
• They are known to carry newer products first and also carry more complete product lines (especially those of their manufacturer "partners" like Kraft, Nestle and Johnson & Johnson).
• Buying products through Netgrocer.com means your weekly trip to your local grocer can be that much more efficient.
• Familiar and fast FedEx is their mode of shipping.

Shelf Space, No Matter
The customer that wants access to the broader product line, a specialty item, or the least popular product of a certain brand is the "right customer."

Brick and mortar grocery stores have only so much shelf space and need to carry perishable as well as non-perishable products, so their "real estate sensitivity" can greatly affect their ability to serve customers fully. On the other hand, Netgrocer.com, with its 120,000 square-foot warehouse, only carries non-perishable items and thus can be purely customer service sensitive. Shelf space is not an issue for them, so what the customer wants remains the priority.

"Community" Not Included
The customer who looks to Netgrocer.com for its utility and efficiency is the "right" customer.

Interestingly, a company that naturally generates many customer referrals via word-of-mouth/mouse, doesn't work to develop any formal online "community." During our interview, Lisa shared that while Netgrocer.com considered incorporating community into their web strategy, they recognized that it would likely dilute their focus and make their service less efficient.

It makes sense that Netgrocer.com decided not to invest in community. These days grocery shopping is more a chore to quickly cross off the to-do list than an opportunity to linger and chat with fellow shoppers, or share tips. Why force something that isn't a natural occurrence?

What's Good For Customers Is Also Good For Business
Because Netgrocer.com complements traditional grocery store shopping (rather than competing with it), they can focus on delivering customer service and finding the impossible-to-find items for their very loyal fans. The "right" customers continue to truly value their efforts.

Of course, it takes some great business relationships to provide all these incredible things for customers. Netgrocer.com/Nexpansion is now expanding their services even more so by entering into some powerful arrangements (called "Endless Aisle") with local grocers.

"Part 2: Nexpansion: 'Endless Aisles' for Everyone!" will tell you more about how keeping Netgrocer.com customers happy at the front of the "store" starts with great business relationships in the stockroom.